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Biofuels are evolving in complex systems of interrelating environmental, economic and social issues. For this reason a number of sustainability criteria covering these issues have been developed. However, there has been little effort given to the development of a mechanism to evaluate compliance of biofuel systems with the sustainability criteria available. Grounded in the theoretical and practical insights from systems thinking and literature on indicator selection processes, this paper intends to extend the existing discussions on the sustainability of biofuels by providing a critical review of biofuels sustainability literature and providing a conceptual framework to guide thinking about measuring, monitoring and evaluating sustainability of biofuel systems. The paper focuses on the integration of social, economic and environmental issues to establish holistically the sustainability of biofuel systems. The paper established that monitoring and evaluation indicators should reflect: (i) all the processes involved in the life cycle of biofuels; (ii) interrelationships of subsystems and related impacts; (iii) different subsystem perspectives (economic, environmental, and social); and (iv) a process of continual learning, which facilitates improved functioning of the entire biofuel system.